Checklist of required IVA documentation

Individual Voluntary Arrangement (IVA) is a debt solution for the defaulters to pay their outstanding debt at a reduced amount over a period of time. This is a viable option for those people who cannot pay their debts and want to avoid the drastic effects of Bankruptcy on their fiscal status. This process is legally binding on all the parties involved; Debtor, Creditors and the Insolvency Practitioner (a professional who acts as a mediator between the two parties).

Legal processes require a lot of paperwork. The case with an Individual Voluntary Arrangement is not different. Application form for IVA, Proposal Plan and Nominee’s Report are only some of the documents to be prepared during the IVA period. But there are certain documents required before starting this process. Here is a checklist of required documentation which a Debtor must provide before going for an IVA:

Statements and letters from the Creditors

The Insolvency Practitioner will ask the Debtor to submit any letters or Statements that show the total amount currently owed to the Creditors. The Debtor should owe a total amount of over ₤15,000 to be eligible for applying for the IVA. This information from the Creditors should also include the Debtor’s current account or reference number.
These documents help the IP to formulate an appropriate proposal which will be submitted to the Creditors on the later stages.

Property Evaluation

Your property will be evaluated. However, if this is not possible then the sales information for similar properties on the same street or local area that may have sold recently is provided to the Insolvency Practitioner. This information can be gathered from your local newspapers or real estate agents. However, the Debtor’s actual property valuation is preferred.

This evaluation is necessary as the equity is released to the Creditors in the last year of the IVA process.

Car finance or hire purchase agreement

If the Debtor has car finance or an HP agreement he should provide the original agreement and any other letter that he may have received.

Mortgage statement

This is the annual statement for the Debtors’ mortgage which the Insolvency Practitioner will ask to be provided.

This statement is needed to help identify information on the Debtor’s property payments. This information is also required to formulate an appropriate IVA proposal.

Endowment Policy Surrender Value

Endowment Policy Surrender Value is also provided to the IP. The Debtor may contact their insurance providers and ask them for a confirmation of their current surrender value. The Debtor may also ask the insurance providers to send them a copy of that information for their records.

Salary payment statement

The IVA proposal has more chances of acceptance if the Debtor is employed.

The Debtor has to present payslips of at least three months. The Debtor also has to provide the payslips of his spouse even if the spouse is not liable for any the outstanding debts. This is in the favor of the Debtor as these salary payment statements enhance the chances of the endorsement of the IVA.

Reasons for your financial hardship

This document has a personal history and detailed description of the Debtor’s recent financial crises. All of the setbacks that the Debtor has encountered which leads him to the money problems are explained.

Huge outstanding debts may be the sole or a major reason for the Debtor opting for the IVA. However, to convince the Creditors you must specify other issues that you have come across. The Creditors may relate better to things like illness, loss of spouse’s income or unemployment.

These documents are mandatory for an IVA. However, the Insolvency Practitioner may ask the Debtor to provide any further documents he deems necessary.

The Debtor must provide the accurate documents without concealing anything. This information is as important in the acceptance of the Debtor’s IVA as the amount that the Creditors will receive. Nearly, all of the above mentioned documents are required by the Insolvency Practitioner at the very initial phases of the IVA.
Therefore, if you are planning to eliminate your debts with an IVA, you must get these documents at hand!

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